Ellis Act

The Ellis Act is a provision in California Law, (Government Code section 7060-7060.7 [1]) which provides landlords in California with a legal way to "go out of business" short of selling the property to another landlord. It is often used as a way out of municipal rent control provisions.[2].

The Ellis Act "was adopted by the California Legislature in 1985 after the California Supreme Court ruled that landlords do not have the right to evict tenants to go out of the business of being a landlord"[3]

Municipalities can regulate the Ellis Act eviction process to some extent and those that do typically restrict the property from use as a rental property for a period of time and that it go back under rent control provisions if it is returned to the rental market.[4]

• San Francisco requires compensation from about $5,000 up to more than $18,000 per tenant depending upon age and disability [5].

• Santa Monica requires an owner get a re-occupation permit before the building can be used for any purpose following Ellis Act evictions [6].

• Los Angeles applies rent control provisions to unit built on the same property up to five years later.[7]